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The new small cars

There's not much that's sexy about inexpensive compact sedans. These are cars designed for economy, not excitement. But automakers are doing what they can to drum up buzz.
Image: Audi TTS
The coupe version of the Audi TTS looks like an Audi, with its unmistakable quad exhaust pipes and xenon-plus headlights, and LED daytime running lights. It has a 265-horsepower 2.0-liter, 4-cylinder engine that goes from zero to 60 mph in 4.9 seconds.Audi
/ Source: Forbes

There's not much that's sexy about inexpensive compact sedans. These are cars designed for economy, not excitement.

But automakers are doing what they can to drum up buzz among young drivers. Pop star Katy Perry and the band Cobra Starship recently performed at events in New York to kick off the new Volkswagen Jetta and Ford Fiesta, respectively, and manufacturers are striving to bring efficient, revitalized models to U.S. drivers.

In fact, there's a whole new breed of compact sedans on the way. These are cars that look and cost like their predecessors, but which are introducing new features —and a new attitude—into the American compact car market.

"We have always done well in this market by standing out in the pack," Volkswagen of America President Stefan Jacoby said at the Times Square unveiling of the 2011 Jetta. "Today, more than ever, VW is at home in America."

Volkswagen isn't the only manufacturer strengthening its business in the smaller car segments. Audi has finally added its high-performance "S" version to the TT line, and Chevrolet's new Cruze, while not nearly as small, means stiff competition from the Detroit-based manufacturer for Honda's Civic and Ford's Focus, among others.

Hitting the $16,000 Mark
Expect the Cruze, Civic, Focus and Jetta to battle for honors as the top model in the compact economy sedan market. Last year the Jetta sold about 100,000 units in the U.S.; Jacoby has said his goal is to boost that by as much as 30 percent this year (Jetta sold 8,000 cars last month). Meanwhile, Honda's Civic dominated sales in the segment last month, selling 29,000 units, up 37 percent from this time last year.

Compact sedans work their way to the top of the sales charts by offering a lower price than competitors (like the $15,655 Civic) or by offering more standard options. At $16,995, the Cruze costs more than its rivals, but it offers several must-have technology options like Bluetooth and satellite radio. Traction and stability control, air conditioning, power locks and mirrors, standard OnStar Automatic Crash Response for six months and 10 airbags are standard (the Civic offers six airbags).

The Jetta (available this October) embodies Volkswagen's plan to develop compact and mid-size cars specifically for the U.S. market. It capitalizes on German design (smooth lines, clean interiors) and a variety of engineering: Drivers can choose from four different engines, including a 2.0-liter direct injection turbodiesel and a gutsy 2.0 TSI in 2011. Manual transmission on the Jetta is standard; automatic on each engine is optional. The full range of S, SE, SEL and TDI and a 2.0-liter GLI on the Jetta will be available only in the U.S.

Party On
Ford, on the other hand, has positioned its Focus to exude fuel efficiency and fun. Smaller in length and weight than the Focus and Jetta, the $13,320 Fiesta gets 29 miles per gallon in the city and 40 on the open road—better than even the Honda Fit (28 city/35 hwy) and Hyundai Accent (27 city/36 hwy).

The "fun" part of the Fiesta is communicated most immediately by color options like "lime squeeze metallic" and "blue flame." Lisa Fleming Brock, a spokeswoman for Ford, says that much thought went into each color name. The unusual colors wouldn't necessarily look good on an F-150, but they capture the spirit of the Fiesta and fit such a diminutive vehicle perfectly, she says.

This fall, the Fiesta will compete directly against Chevy's Aveo, Honda's Fit, Nissan's Versa and the Toyota Yaris. Only sales figures will really tell how it fares against the established models. Right now, at least, it beats them all on highway fuel economy and has been the most-hyped of the lot — though the mass-market appeal of a band like Cobra Starship is up for debate.